Most people are fairly convinced their property is worth £xxx,000! However rarely does a property have one set price. Pricing a property is a complicated process and many people will have their own personal and professional opinion.

Here is an example of how a property can have SIX different prices placed on it during a purchase/sale:-

Property Example:-

Asking Price: £265,000
This is the price that the property is marketed at, ie the price it will appear online such as Rightmove or on the advertising material.

Offer Price: £250,000
This is the price that a buyer initially offers - in this case trying to keep within the 1% stamp duty limit.

Accepted Price: £259,000 minus 2% stamp duty
After renegotiation between the buyer/seller, the buyer agrees to offer £259,000 as long as the seller pays the additional 2% stamp duty (which would be 2% x £259,000 = £5,180) so the actual price that will now be paid is:-

£259,000 - £5,180 = £253,820.

Mortgage Valuation: £253,820
In this case the valuation done by the company lending to the buyer, agrees with the offer accepted. However sometimes this figure can also be different!

Surveyor's Valuation: £249,000
In this case the surveyor finds things wrong in the property such as damp problems or a structural issue in the roof which needs to be sorted, so they deduct the cost of this off the £253,820 and give this new lower valuation.

Final Agreed Price £252,000
The seller won't discount the property down to the surveyor's £249,000 and the buyer still wants the property so both parties settle on a final price of £252,000.

Property Price Reports Reflect the Six Different Prices of a Property
Interestingly, if you compare these different property price levels to the property price reports, you will see that the Rightmove Index often gives the highest average price - and that's because it's data comes from 'asking prices'. The Land Registry often gives the lowest average price - and that's because it's data comes from 'finally agreed prices'.

This explains why when property price trends are changing (from a static to an increasing market or vice versa) the media sometimes report prices growing one week, then the next prices falling. For example, when the market is picking up, the first indication of this is from 'asking prices' increasing ie. Rightmove, meanwhile, as the Land Registry data can be up to three months behind the buying/selling process, they may still be recording a fall!